The Huffington Post reports that the Department of Justice is fixing to slap a lawsuit on Wells-Fargo for “allegedly preying upon African American borrowers during the housing bubble and steering them into high-cost subprime loans,” which seems a little strange, considering that this was the goal of certain government policies leading up to the subprime crisis.
In the 1990s, the Clinton administration pushed for increased homeownership among traditionally under-represented groups. The Department of Housing and Urban Development released the “National Homeownership Strategy” in 1994. The plan for increasing homeownership includes this ominous statement:
For many potential homebuyers, the lack of cash available to accumulate the required downpayment and closing costs is the major impediment to purchasing a home. Other households do not have sufficient available income to to make the monthly payments on mortgages financed at market interest rates for standard loan terms. Financing strategies, fueled by the creativity and resources of the private and public sectors, should address both of these financial barriers to homeownership.
[click to continue…]
Amazon.com is standing strong against California’s attempts to extort money from the online bookseller. Just a few days ago, Governor Jerry Brown (whose aura smiles and never frowns) signed a bill into law aimed at extracting taxes from online retailers. As it is now, the state requires consumers to keep receipts of online purchases, calculate sales tax on those purchases, then send a check to Sacramento. Obviously, this policy proved difficult to enforce.
California’s Board of Equalization (the sinister-sounding body charged with collecting the state’s sales tax) issued a stern warning to Amazon and its comrade-in-arms Overstock.com: pay up or we’re coming after you. California’s case against the retailers rests on going after affiliates and subsidiaries in the state. Amazon has already begun cutting affiliates like gangrenous limbs. California still thinks the law will work; fortunately, they might be wrong, as a Declan McCullagh of CNET writes:
The only problem for enthusiastic politicians and tax collectors is that the new law might not be entirely, well, legal.
In 1994, a California appeals court rejected state tax collectors’ arguments when they tried a similar approach. The case involved a Colorado-based company, Current, which sold greeting cards, gift wrapping paper, and so on through the mail. It had no contacts with California.
Current’s parent company, Deluxe Corp., did do business in California. The state Board of Equalization, operating under the theory that the finer points of corporate structure weren’t that relevant, levied $344,088 in taxes on Current.
The appeals court tossed out that argument, saying that courts in Pennsylvania, Illinois, and Connecticut had considered similar cases and had all ruled against the tax collectors. Those decisions were “persuasive,” a three-judge panel unanimously ruled, and Current and Deluxe “did not have integrated operations or management” and were “separate and distinct corporate entities.”
[click to continue…]
You might’ve read about the unintended consequences of Georgia’s crackdown on undocumented workers. Well, the same thing is about to happen in Alabama. A few weeks after Governor Bentley’s signing of a bill that will attack undocumented workers, Hispanic immigrants are already fleeing the state. The Alabama law is one of the harshest in the recent spate of anti-worker and anti-business legislation. It criminalizes assisting undocumented workers and imposes harsh penalties on businesses employing them. Businesses will be forced to use the intrusive and wasteful E-Verify system, putting immigration enforcement costs on entrepreneurs. It makes all public officials into immigration agents too by requiring them to constantly enforce the law. More disturbingly, it allows for the arrest of individuals suspected of being in the country illegally, effectively making Alabamians guilty until proven innocent.
Practically, the law is just as stupid as Georgia’s. After tornadoes swept through the state, devastating large areas, including the city of Tuscaloosa, you’d think rebuilding would be a priority. But apparrently not if cheap, skilled, undocumented workers are doing the rebuilding. Contractors are predicting labor shortages, which will drive up the price of reconstruction. In a state that already suffers from tornadoes and hurricanes, making it more expensive to live in Alabama doesn’t sound like the brightest idea.
[click to continue…]
Two days ago, the advocacy group Consumer Watchdog filed an anti-trust complaint with the FTC seeking an investigation of Facebook’s allegedly anti-competitive practices. These incude Facebook’s plan to implement new rules for game developers using its platform and Facebook’s deal with the largest social gaming developer, Zynga, Inc.
With a 2012 IPO looming, Facebook has been looking to revise its policies.The new rules prohibit developers from charging lower fees for virtual goods outside Facebook. The social media company would also require developers to exchange with users through Facebook Credits, Facebook’s virtual currency. Third, Facebook would deduct 30 cents of every dollar from payments made through the system. Consumer Watchdog goes so far as to say that Facebook is seeking a monopoly.
But are Facebook’s policies really that evil? Are Americans going to see “Mark Zuckerberg’s face replacing George Washington’s on the dollar bill. Or rubbing out all the dead presidents on every bit of American currency,” as Consumer Watchdog says? Probably not.
On the first count, Facebook’s new rule seeking what almost amounts to exclusivity might be tight-fisted, but it’s not that bad. It won’t dictate prices in browser-based games, and I doubt it will even dictate prices in social gaming. Even if every game developer used the Facebook platform, there would still be competition among games and developers. Fortunately, that scenario isn’t even realistic; not every developer works through Facebook. Many developers work outside the Realm of Zuckerberg, and the more Marky Z. tries to control his content providers, the more they will begin to move away.
[click to continue…]
Who’d of thought it: cracking down on immigrant workers hurts the economy? Georgia’s learning the hard way as farms lose laborers and crops go unharvested. After its passing of strict anti-immigrant legislation in April, thousands of illegal workers have fled the state before the implementation of the law in July. This exodus of experienced farmhands meant 11,080 farm jobs left unfilled.
With a labor shortage to deal with, the government of the state of Georgia has a novel way of filling the vacancies: probationers. Atlanta also instituted a program to encourage those on probation to find work in the fields. Ex-cons, who find getting jobs difficult, aren’t exactly overjoyed at the opportunity, though. The grueling conditions and long hours of farm work discourage many new workers. Sometimes it only takes a few hours for them to quit.
Of course, the new workers cite wages as the reason for their high turnover rates, but you’ve got to wonder just how much would constitute “fair” pay. Whatever it is, it was high enough to make farmers turn to illegal workers in the first place. The lack of a stable workforce and skilled farmhands means less efficiency and less food. As food prices continue to rise, increasing the cost of labor on farms doesn’t sound like the smartest idea. The story’s too familiar though: politicians demagogue immigrants, then pass stupid bills, farmers complain, and almost everyone suffers.
Two things most people have never heard of before have been in the news recently: Bitcoin and LulzSec. Over the weekend the largest Bitcoin exchange, MTGox, was hacked, compromising user accounts and devastating the exchange’s credibility. The attack involved a massive sell off of Bitcoins in MTGox’s network, which is in the process of being rolled back.
Yesterday, the arrest by British Police of a suspected LulzSec member was announced. So what’s the link between the two? Apparently The Guardian feels confident enough to invent one. An article catchily titled “LulzSec rogue suspected of Bitcoin hack” outlines an unsupported theory about the Mt. Gox fiasco. So, who exactly suspects LulzSec, besides The Guardian? Except for those regurgitating The Guardian’s line, no one, really.
I suspect the sensational title isn’t anything more malicious than a plea for page views, but there’s still something dishonest about making such a tendentious link. There’s just no evidence linking LulzSec to the attack. The article admits that LulzSec would stand to lose from Bitcoin attacks and that LulzSec has denied responsibility, which the Guardian recognizes as out of character for a group of trolls after a successful hack. Finally, the article admits the “possibility of a third, as yet unnamed, group of hackers carrying out the attacks,” which would seem to be the most logical conclusion. Perhaps the Guardian should avoid running such blatantly misleading ledes. But I guess when you can only name one or two hacking collectives, its best to arbitrarily assign responsibility.
Foreign Policy just ran another “Postcards from Hell” feature detailing the worst of the worst from their “Failed States Index.” It’s worth a look. Sixty images depict the consequences of corruption, endemic violence, totalitarianism, and central planning. Unfortunately, FP doesn’t seem to recognize the connections between these problems. The “failed state” is one of too little power, except sometimes when it has power and it still fails; but then we can blame things like wars, mineral wealth, or climatological factors, right?
Immediately, they blame the problems of the Somali people on their lack of a clear, central authority (no mention, of course, of government-perpetrated oppression in Somalia, or the dubious humanitarian credentials of the U.N.’s blue-helmets). If only Somalia had a strong, central government like Eritrea! Then we wouldn’t have to worry about those pesky pirates! But wait, Eritrea makes it on FP’s list too. At least an oppressive state can qualify as a failed state.
North Korea shows up a bit later, which inspires one to ask why this state, the model of centralization, failed. It surely can’t be because the state has too little power. Instead, the obvious answer must be that Pyongyang’s policy of collectivization and top-down economic planning produces massive poverty. But does FP draw this conclusion? No. Apparently, the DPRK’s economic woes are the product of a “bad harvest.” A bad harvest that has been recurring for 50 years, presumably. How strange that the south, with its similar weather and geography, has not been devastated by climatic caprice. Forget the knowledge and calculation problems associated with the lack of a price system, collectivized capital, and no markets — in the 21st century, we’re still at the mercy of the rains.
[click to continue…]
RSS Updates 
RSS E-Mail Updates 
Twitter 
Facebook 
CEI.org 
WorkPlaceChoice.org 
GlobalWarming.org 
CEI On Demand Video 
Liberty Week Podcast 